Broker to Trading

Scalping is opening and closing positions in a short time frame, typically under a minute or so. Scalping is different from medium- and long-term trading, as it seeks to exploit short-term changes in direction in the movement of a Forex pair. Scalping is different from news trading (which can be very short-term trading as well), as it is not necessarily based around a data release.

As the name suggests, scalping is a technique that aims to scalp small movements in value from the market. With larger trade sizes, these small values can be magnified, but in all events, when added together, the cumulative effect is intended to be worthwhile to the trader. The trader does not have to wait for retracements to move in the traded direction, which can be a motivation to scalp.

This said, in short-term time frames, the market can be volatile and may change direction just as it does on longer time frames. When scalping, the trader is aiming to exit away from retracements and stay in short-term directional moves (the value scalp, as it were). A scalping trade can also be turned into a longer-term trade if the market continues to move in the traded direction. Thus, scalping can be combined with trading on various time frames as part of a way to trade on varying market conditions.

Market conditions do vary considerably. Traders may look for some kind of constancy in the market, for example, market opens and closes or news events and trades around these, but can find that the unpredictability is there even if some factors are kept constant (such as market events or market open and close). In scalping, the trader aims to trade on the movement itself, as the market produces increases and decreases in momentum and direction.

On short-term time frames patterns are evident, though with volatility which may be smoothed out on higher time frames. The trader may want to check higher time frames, as these can provide some kind of clue about why a move may be changing direction, but what is happening on higher time frames may not be that much help with short-term trades on lower time frames. The trader may trade with an indicator, but may find that there are issues using it on very short-term trades. They can trade on patterns and, by examination of the chart, look for increases in size of candles, for example, to indicate increased momentum (when using a candlestick chart, which is useful on shorter- and longer-term time frames).

So if a trader is interested in scalping, they need to find a broker that supports it. Some brokers do not allow scalping, and others may not support this approach fully. So one way out of this is to trade with a broker that has fast order processing and tight spreads and does not intervene in the order process (hence allowing a wide range of trading styles). In general, brokers like this allow and support scalping. Since some brokers do not support scalpers, it is generally a good idea to find one that explicitly says that it does support this trading strategy.

The trader can use automated trading strategies to scalp for them. They may find that repetitive short-term trades are tiring and may wish to use a program (robot) to trade on their behalf. The trader can automate their own scalping strategies or can use software designed to do this.

The brokers in the table above all allow scalping and provide online trading platforms which can be used to scalp the Forex market (for example, user-friendly but powerful cTrader). One thing to note is that when trading on an account with Forex commissions, the trader may be offered very low spreads for the more liquid Forex pairs, but the commission charge will be taken for each trade.

Best Forex Broker For Scalping

The pick of "Best Forex Broker for Scalping" is IC Markets. IC Markets supports a wide range of Forex trading but has a range of offerings for those who scalp. It provides both MT4 and MT5, which are widely used by scalpers. Additionally, it offers cTrader and TradingView, both of which support scalping.

Scalpers can be either discretionary or automated. Scalpers may start out as discretionary traders, perhaps even by testing rapid trading after using longer-term strategies. Day trading itself is relatively rapid, so it can be a route from trying out day trading strategies to ending up scalping (though the reverse can also be the case). The trader may refine a strategy and note that it may be easier to have a robot execute on their behalf.

IC Markets' platforms all support automated trading, with EAs on MT4 and MT5, cBots on cTrader, and Pine Script on TradingView. IC Markets' trading infrastructure is optimized for rapid order transmission: it uses Equinix NY4 center, which co-locates with institutions and liquidity providers, utilizing technologies such as optical cables for rapid order processing.